Anwar et al v. Fairfield Greenwich Limited et al

Filing 1355

ORDER: Accordingly, it is hereby ORDERED that the terms of the Court's December 19, 2014 Order Authorizing Distribution of the Fairfield Greenwich Net Settlement Fund (the "December 19 Order") are reaffirmed; and it is further ORDERED that the application of claimant ASM Capital, L. P. and its affiliates requesting relief from the denial of their claims for distribution of settlement funds pursuant to the December 19 Order is DENIED. (Signed by Judge Victor Marrero on 2/19/2015) (lmb)

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PASHAS. ANWAR, et al.,
09 Civ. 0118 (VM)
Plaintiffs,
ORDER

- against FAIRFIELD GREENWICH LIMITED,
et al.,
Defendants.

-----------------------------------x
VICTOR MARRERO, United States District Judge.

By

Judgment

and

No.

dated March 22,

Final

Prejudice

(Dkt.

approved

a

action,

resolving

Greenwich
Limited

$50.25

996)
Net

million

and

Class

Fairfield
"Fairfield

Greenwich

of

partial

of

as

Greenwich
Limited

embodied

Settlement

this

Fairfield

(Bermuda)

Greenwich"),
of

this Court

the

Fairfield

Greenwich

Stipulation

2013,

by

against

with

Dismissal

settlement

asserted

claims

Settlement

(collectively
Fairfield

1097)

Order

in

(Dkt.

the
No.

and the Plan of Allocation of the Fairfield Greenwich
Settlement

Fund

(Dkt.
the

No.

Court

determined

that

fair,

reasonable,

and adequate,

1097).

terms

of

In
the

that

Order,

settlement

the
were

and in the best interests

of the Class. After a series of appeals,

all of which were

denied by the United States Court of Appeals for the Second
Circuit,

the

Fairfield

Greenwich

settlement

became

effective on November 6, 2014.
By letter dated December 17,
Counsel,

proposed distribution

Declarations of Robert C.
Entry

of

Greenwich

an

Net

Declaration

of

"Plaintiffs'
who

sought

Settlement
court

Order

to

Robert

on

may
~

Authorizing

due

order

(Dkt.

C.

Finkel

informed

the

investors'
the

2014,

letter dated

and its affiliates

Counsel

and

1344.)

The

Court

that

the

that

one

[Fairfield

assignments
rejection

Fairfield

Greenwich]

of

of

claimant

bankruptcy

its

claims."

upon reviewing the declarations

deliberation,

of

the

9.)

Distribution

rejection

accompanying

1343,

anticipate
in

contest

of

Nos.

the

of

the

Court

February

( "ASM")
its

Claims

four

6,

issued

Fairfield

Settlement Fund ("December 19 Order") .

the

with

Distribution

Counsel

On December 19,
after

for

participate

based

claims,

By

Co-Lead

Finkel and Jason Rabe in Support

Settlement.

Co-Lead

(Dkt. No. 1343,

and

Plaintiffs'

acting on behalf of the Representative Plaintiffs,

submitted a

of

2014,

an

Order

Greenwich

Net

(Dkt. No. 1345.)

2015,

ASM

Capital,

L.P.

requested that the Court review
claims

Administrator.

by
ASM

the relevant Claim Purchase Agreements

Plaintiffs'
argues
(the

Co-Lead

that,

under

"Agreements"),

ASM is entitled to participate in distributions or proceeds
as

assignee

of

Syd Silverman,
2

Mary

Kellog-Joslyn

IRA RO,

Mil ton Fine Revocable Trust,
(collectively,

the

letter,

and Robert Cri tchell III IRA

challenges

ASM

Plaintiffs'

"Assignors") .

co-lead

that

made only with respect
the

litigation

settlement.
receive

claims

(Id.)

"the

with

the

1351.)

the

In

its

made

by

assistance

Additionally,

to

the

the
were

and not

Fairfield Greenwich

ASM argues that it did not
[ASM]

notice

of

contested assignments

to Bankruptcy proceedings
related

proper

No.

determination

the

counsel,

Claims Administrator,

(Dkt.

were

promised"

Plaintiffs of any claims resolution or distribution.

from

(Id.)

Plaintiffs responded by letter dated February 11, 2015
and

reiterated

their

determination

assignment, on its face,

that

"ASM' s

purported

related only to bankruptcy claims,

and not litigation claims filed in federal district court."
(Dkt. No. 1352.) The Assignors have taken the same position
as

the

Plaintiffs,

distributions
Fund.

from

the

filed

claims to receive

Fairfield Greenwich Net

Settlement

(Id.)
Additionally,

message
him

and they have

on December 1 7,

that

Court.

Plaintiffs stated that they left a voice

the

proposed

2014
order

for ASM' s

counsel

had

submitted

been

(Id.) According to Plaintiffs'

Rule

of

Civil

Procedure
3

to

the

letter, ASM's counsel

states that he did not receive the voice message.
Federal

informing

23 (e)

(Id.)

mandates

that

courts oversee the distribution of class settlement funds.
In

re

Citigroup

Sec.

Litig.,

No.

2445714, at *l (S.D.N.Y. May 30,
Beecher

v.

District

Able,

575

courts

F.2d

retain

07

2014)

1010,

"broad

Civ.

9901,

(citing,

1016

(2d

supervisory

respect to overseeing distribution.

2014

WL

inter alia,

Cir.

1978)).

powers"

with

In re Holocaust Victims

Assets Litig., 413 F.3d 183, 185 (2d Cir. 2001).
In
23(e),

accordance
this

Court

administration,
of

the

with

Federal

of

Civil

Procedure

jurisdiction

reserved

over:

" ( i)

interpretation,

Stipulation

and

Rule

the

effectuation or enforcement

this

(ii)

Judgment;

Final

disposition of the Settlement Fund and/or Escrow Fund;
(iii)
and

any application for attorneys'
reimbursement

Judgment
1097,

~

of

expenses

and Order of
33.)

in

fees,
the

costs,

interest,
(Final

Action."

Dismissal with Prejudice,

In analyzing the present dispute,

and

Dkt.
the

No.

Court

"proceeds from the premise that the non-objecting eligible
claimants are due an expeditious recovery." In re Citigroup
Inc.

Sec. Litig., No.

07 Civ.

9901,

2014 WL 7399039,

at *2

(S.D.N.Y. Dec. 29, 2014).
The dispute here focuses on the interpretation of the
Agreements between ASM and the Assignors.
that

the

relating

only
to

claims

the

the

Agreements

Bankruptcy

Plaintiffs found
assign

proceedings.
4

As

are

those

Plaintiffs

indicated

in

an

August

among

based,

was

conclusion

2013

5,

letter

to

ASM,

things,

other

this

on

the

contractual language:
[Assignor]
does
hereby
absolutely
and
unconditionally sell,
convey,
and transfer to ASM
Capital, L.P.
all of Seller's right, title,
benefit and interest in and to any and all of Seller's
pre-petition claim or claims, equity interests, or as
more specifically set forth as any right to payment
(the
"Claim"),
against Greenwich Sentry,
LP
(the
"Debtor"), in bankruptcy proceedings in the United
States Bankruptcy Court for the Southern District of
New York
(the
"Court"),
Case No.
10-16220
(the
"Case") .
(Dkt. No. 1354.)
This

Court

has

reviewed

the

single

objection to

the

distribution of the Fairfield Greenwich Net Settlement Fund
by ASM

and

claims.

The

agrees

with

Anwar

the

Plaintiffs'

litigation

rejection of

claims

are

"direct

the
and

independent claims against non-debtor parties and thus not
claims

against

a

debtor."

Bernard L. Madoff Inv.
2013)

aff'd sub nom.

Sec.

Sec. LLC,
Picard v.

Investor
490 B.R.

Prot.
59,

67

Corp.

v.

(S.D.N.Y.

Fairfield Greenwich Ltd.,

762 F.3d 199 (2d Cir. 2014).
Further, even if Plaintiffs had "promised" ASM that it
would provide further notice before filing declarations and
a proposed order with the Court
failure

to

violation.

inform

ASM

does

not

(see Dkt.
rise

In the December 19 Order,
5

to

No.
a

1351),
due

such

process

the Court determined

that,

"in

Class

Members

deficient

satisfaction
who

were:

of

filed
( 1)

to

the

process

claims

that

informed

ineligible or deficient;
respond

due

and

were

that

( 2)

determination

requirements,

all

ineligible

their

claims

or

were

given the opportunity to
of

ineligibility

and

to

correct any deficiency prior to their claims being finally
rejected."

(Dkt. No. 1343, p. 2.)

object

the

to

December

19,

2014

In any event, ASM did not
Order

until

February

6,

2015 -- beyond the 14 days provided for in Local Civil Rule
6.3 to petition the Court to reconsider an order.

Accordingly, it is hereby
ORDERED
2014

Order

that

the

terms

Authorizing

of

the

Court's

Distribution

of

December
the

19,

Fairfield

Greenwich Net Settlement Fund (the "December 19 Order") are
reaffirmed; and it is further
ORDERED that the application of claimant ASM Capital,

L. P.
of

and its affiliates requesting relief
their

claims

for

distribution

of

from the denial
settlement

pursuant to the December 19 Order is DENIED.

SO ORDERED.

Dated: New York, New York
19 February 2015

~~-o7ViCTORMARRERO
U.S.D.J.

6

funds